Employees with a stable income stay in a perpetual infant-like consumer state. They don’t know what they want and never think for themselves. When they see a new bike advertised at 40% off for one day only, they don’t stop and ask themselves whether they need a new bike. Instead, they fixate on the amount they stand to save by making the purchase. For just $720, they are able to purchase a bike that is usually priced at $1200, a saving of $480. Who wouldn’t want to save $480? Of course, the reality is that, unless they need the bike and were going to purchase it at the full retail price, they are not saving $480; instead, they are spending $720. The discounted amount doesn’t mean anything — it’s a number pulled out of thin air. The consumer is still spending $720 and the retailer is still making a profit.
With most of the purchases we make in life, we are just trying to fit in. We want a big wedding because we are told that it is the thing to do. We never stop to think about whether we actually want to do it. We buy champagne to celebrate because we see it in shows, movies, and magazines. Do we even like champagne? What if we would rather celebrate with a Big Mac? Would that be socially acceptable? We go on holidays to places we have very little interest in visiting, all for the photo opportunity.
After six months in business I noticed something interesting about consumer behaviour: consumers often parrot off any information they are told. Companies can say almost anything to consumers and consumers will repeat it straight back to them, without thinking. It was happening all over social media. Have a tea that tastes like dirt? Never fear, just market it as “refreshing and uplifting” and your customers will repeat those words right back to you. I tried it out for myself on numerous occasions before my conscience got the better of me. I began promoting my tea as a way to improve skin elasticity and complexion. Within days, several customers reported back to me that their skin had improved after drinking the tea. Miraculous! Every few days, I would add an effect and sure enough, customers would notice the corresponding change. I had complete control over how they were responding to my products — a terrifying thought for such a small company. Imagine what a company like The Coca-Cola Company is able to do. I suppose that’s why they can come out with a new sugar free product with no artificial sweeteners and customers will think that it is healthy — never mind that it contains large quantities of stevia. Until stevia faces the same public relations woes as sugar, it is their golden ticket to keep consumers thirsty for their calorie laden beverages.
Companies can say almost anything to consumers and consumers will repeat it straight back to them, without thinking
I felt deeply ashamed of the company I had created. I knew it was a step down from law. Anyone can start a company selling loose-leaf tea: there are literally zero barriers to entry. Teabags, at least, felt like a step in the right direction. It was hard having to come up with excuses every time someone asked what I was doing with my life — I felt like that person we all know who likes to say, “You just wait, I’m going to be famous one day.” I had a vision in my head of what I wanted the business to look like, but that vision was dependent on making a lot of money selling teabags, so I could branch out into other things. It’s difficult to convey what it felt like waiting all that time for the teabags to arrive. I didn’t know if they would be shipped, or what the quality would be like, and I certainly didn’t know anything about the importation process.
Prior to receiving my first shipment of tea, I had been operating under the assumption that having products shipped by sea was just like having a DHL or FedEx package delivered from overseas — you place an order, it gets shipped, and then it arrives. I had no idea that I needed insurance and an import agent who would pick up the shipment from the production warehouse in China, take it to the nearest port, and fill out export and import documentation. I had no idea that once it arrived in the country, I would have to use another company to pick up the shipment from the port and store it at a different warehouse until it cleared customs and other inspections and was ready to be delivered to the final destination. It was something that added several thousand dollars to the final cost of the tea. Just like most things in business, you only learn these things by actually going through the importation process. I went through three terrible import agents and wasted tens of thousands of dollars before I found a reliable one. Importing became a lot easier to navigate once I developed a good relationship with an import agent who was able to take care of the end-to-end process for me. It’s not so easy to find reliable suppliers without industry experience and insight. If you ask someone in the logistics industry who the best companies are, they will be able to answer straight away. If you don’t have someone to ask, it may take a lifetime to figure it out.
Since it can be such a costly exercise finding suppliers and forming relationships, it’s important to hold that information close to your chest. I can’t tell you the number of times I was asked for the name of my tea suppliers or the name of my sticker manufacturer or the name of my import agent. In their minds, it’s a simple question — it’s a name and nothing more. In my mind, it’s a costly and time-consuming process that could have destroyed my business many times over. You want to know the name of my tea supplier in China? Sure, I will tell you for $30,000. That’s the conservative value I put on the relationship. Otherwise, you can bear the risk and expense of going to China yourself to find a supplier who is reliable and honest, with good communication, and a quality product. Odds are that you will go to China and fail. Even if you do find a supplier, there are no guarantees that they will be able to deliver a quality product. Even if they do provide a quality product once, there is no guarantee that they will do it again. So, why not cut out all the heartache and pay me $30,000 instead? Oh, you just wanted the name for free? I see. As tempting as it is to give you something of value and get nothing back in return, I’ll pass this time.
Unfortunately, there was no way to speed up the production process; I simply had to wait. That’s the trade-off when ordering from China. It’s cheaper than a local manufacturer, but the lead times can be horrendous. The wait time was a problem for me because I expected immediate success. I didn’t want to work my way up from the bottom and grind away over a period of years before I became a success. Other businesses on social media had blown up overnight, so why not me? Even though I was just starting out, I was in a constant state of envy. I spent most of my time comparing myself to others: that logo is better; that name is better; that product is better. I did this for years before realising that it made no sense. Why was I envious of someone else’s success? Their success had nothing to do with me. They weren’t successful at my expense. Sometimes, people with no talent get lucky, just as sometimes people with talent, don’t. If you are fishing for luck to accelerate your business’ growth, you’ll come home empty handed. However, if you stay out long enough, you might just get a bite.
I realised quite early on that it is important to focus on incrementally improving a business rather than trying to do everything at once. I always played around with the copy on the website and the packaging design and the logo to see if there was a better solution in my head. Over time, the business gradually improved. There’s a common misconception that how a business appears today is how it always was. Success means taking a business from a 1 to a 10. To do this, your business may simply require a rebrand; alternatively, it may be a 40-year process. Take Starbucks, for instance. The Starbucks we know today, isn’t the Starbucks of the 1980s. What started as a small coffee shop in Seattle has grown into one of the world’s most recognisable brands with a presence in almost every country on earth. That didn’t happen overnight. It happened in many stages over many years. The takeaway from this, is that you may start with something you are not completely happy with, but that doesn’t mean that a business will always look anything like that in the future. Apple didn’t wait until it had developed the iPhone 8 before it started selling the iPhone. Apple simply started where it was, with the technology and resources that were available at the time. Being in business is like being in a never-ending marathon with no finish line. You start running and see where it takes you.
It is important to focus on incrementally improving a business rather than trying to do everything at once
We like to frame comparisons in present terms. The Harvard of today doesn’t begin to resemble the Harvard of 1636. Even if we look at a more recent comparison, I suspect it’s a lot harder to get into Harvard now than it was even in the 1970s or 1980s, yet we think of them in similar terms. When we hear someone from a graduating class of 1975 went to Harvard, we immediately think of the present-day Harvard to help us understand the reference. If you went to a high school or university whose reputation has dipped since your graduation, you will find that employers think less of you and your achievements. Equally, you could have been an early employee at Google at a time when the company seemed destined to fail. Now, when people see that you worked at Google, they think of present-day Google: you know, that monolithic company that prints cash and recruits some of the most intelligent people on earth.
A variation of this present-day bias can be seen in traditional employment settings. You could work hard for ten years and have a spotless track record but still receive a bad reference as a result of something that happened in the final few months of your employment. A single moment can erase a lifetime of hard work. This is one of my main objections to the reference system that most employers utilise today. You may not receive a reference if someone you were relying on leaves without warning or your immediate supervisor decides that they don’t like you or you happen to leave on (subjectively) bad terms. References matter more than productive output and last impressions matter more than anything. No matter how unreliable references are, nothing will change. As with most things in life, it is better to just accept the status quo. People don’t like change. We like what is familiar. We do things because they have always been done in a particular way, not because they should be done in that way. Employers need to find a more quantifiable way to measure a prospective candidate’s competency and worth.
On the morning that the tea was due to arrive in Auckland harbour, I went to a lookout point and watched as the ship came in. It was an anticlimactic experience. The ship was pulled in by a small tug boat and docked beside a large crane affixed to the loading bay. The whole process took no longer than 10 minutes. The ship wasn’t scheduled to be unloaded for several hours, so I made my way back home. It took a further three days for the tea to be offloaded and transported back to the import agent’s warehouse. From there, it was forwarded on for delivery. I hadn’t thought about how I was going to store the stock. I knew nothing about warehousing at that point. For some reason, I assumed that each company had their own warehouse and staff and this was obviously something I couldn’t afford. I didn’t spend any time looking into other solutions. If I had, I would have found out that it is very easy and common to have products stored in third-party warehouses. With the growth of ecommerce, it is becoming more valuable for commercial landlords to own warehousing space in less desirable areas than it is to own prime retail space in many shopping districts.
I had the delivery driver reverse down a narrow driveway and offload the tea into my parents’ garage. A temporary solution until I could sort out something more permanent. As the driver hurriedly unloaded the pallets, I stood to the side of the open garage, craft knife in hand, blade projected. When the last pallet was unloaded and the driver got back into his cab, I took a few steps over to the nearest tower of boxes and started hacking away at the black grouping wrap. There were five pallets, each one about six feet tall. I pulled a box down from the top of the pallet and moved it to the side of the garage and dug the knife into the tape holding it shut. My knife had been purchased specifically for this occasion; the tape was no match. I pried the lid open with minimal effort. As the light flooded into the box, I felt an immediate sense of relief. Pink boxes. Beautiful pink boxes. Aside from a noticeable colour variation, the packaging looked exactly like my design. I was certain at this point that I was going to be rich. It was better than anything my competitors had designed. How could I lose?
I rushed inside and went straight into the kitchen. I had put the water onto boil as soon as I had seen the truck reversing down the driveway. The water was now a perfect temperature to brew tea. I opened up the first box and was delighted with the appearance of the teabag wrappers. The wrapper itself was perhaps the most important part of the packaging. The teabag wrappers served a dual purpose. First and foremost, they were photogenic and Instagram worthy, so customers and influencers could easily take pictures to show their friends and followers. Secondly, having the tea packed in individual wrappers allowed me to give out samples, which would direct people to the website to buy. I hadn’t seen anything like it on the market. I gathered up five cups and proceeded to brew one teabag in each cup. The tea had a fast brewing time and was ready in just over a minute. I removed the teabags and raised the cup to my lips. The smell transported back to that small room in China, standing next to the tea masters. I took my first sip. My mind was racing. All that worry; all the things that could have gone wrong; all that money. It all rested on that moment. If the tea was good, I could make hundreds of thousands of dollars selling the stock; if it was bad, I would have a garage full of worthless tea and my business adventures would be over. Worse still, I would be forced to get a job.
Thankfully, the tea was perfect. I felt a huge sense of relief. It was exactly how I remembered it. The only remaining doubt I had was whether it was safe for daily consumption. Tony had only given me a few samples of each blend, so I hadn’t hitherto consumed more than one cup in a day. I felt like I owed it to my customers to ensure that the tea was truly safe. With ingestible products, there is always a concern that customers will get sick or otherwise experience negative effects following consumption. What if it somehow had a laxative effect or customers couldn’t consume more than one cup in a day? These are all things that I should have thought about and checked off before ordering. It was my first foray into ingestible products and I was still learning that it was perfectly fine to ask for more information and more samples and more time from suppliers. In fact, they generally expect it.
I felt a true sense of obligation to my customers to make sure that the tea was safe for consumption. I became the company guinea pig. After the first cup, I proceeded to drink the other four cups set up on my kitchen counter in quick succession. For the next week, I consumed ten cups each day and monitored the effects. Apart from losing an alarming amount of water-weight and feeling less bloated, there were no negative effects — no rushing to the toilet, no light-headedness, no stomach cramps. The blend was completely safe for daily consumption. This proved to be a very important feature of the tea that differentiated it from the products that my competitors were offering. Following my competitors’ lead, I initially marketed the tea as a detox product that should only be used a few times a year for no longer than 14 days at a time. When I noticed that demand for more extreme types of detoxing was waning in New Zealand, I was able to change the marketing strategy and market the tea as an everyday detox product — one that could be consumed every day of the year. This not only boosted demand, but meant that I didn’t have to decrease the price. It also meant that customers who were previously only ordering two or three times a year were now comfortable ordering every month and placing much larger orders.